Fund obligations
Trustees of APRA – regulated super entities are required to comply with the standards in the Superannuation data and payment standardsExternal Link, by using SuperStream release authorities to action requests.
When the super fund receives a valid release authority, it is authorised to release an amount from the member’s super account according to the instructions outlined in the included release authority statement (RAS).
This is the information you must provide to us to confirm that you have released the member's money in accordance with the release authority.
It is important the information you report, accurately reflects your members’ circumstances as reporting incorrect values can result in negative consequences for your members, including:
- being incorrectly assessed for additional tax
- the ability for the member to release from the specified account in the future
- significant delays in release authority payments being allocated to the member's account.
Within 10 business days from the issue date of the release authority, super funds must:
- electronically pay us the lesser of
- the amount stated in the release authority
- the total amount of the super interest that could be paid at the time from the member's super interests
- send us a RAS message via SuperStream advising
- the amount that was released to us
- any amount that could not be released and the reason why it could not be released.
When a fund releases an amount to us, we:
- withhold the appropriate amount of tax if applicable
- offset the balance against any outstanding tax or other Australian Government debts
- pay the remaining amount to the member, if applicable.
When sending a RAS to us you must:
- use the same channel we have used to issue the RA, either SuperStream or paper, when you return the RAS
- return the RAS in all cases, including for partial or nil payments.
A trustee can receive a release authority message outside of the standards and SuperStream via a paper notification issued by the Commissioner of Taxation by mail. Trustees need to action the release authority and return the release authority statement (RAS) to us via paper.
RA payments must be made through the same channel the RA was received, for example:
- RA's received via SuperStream payments must be made via the SuperStream bank account
- RA's received by paper, payment must be made using other payment options as per the instructions on the paper form.
Failure to pay via the correct channel will result in delays in payment processing.
We have provided Release authorities – problem solving for SuperSteam users to assist you to avoid processing delays and adverse impacts on your members.
Penalties for funds not meeting their obligations
Super funds that do not meet their release authority obligations may incur significant penalties.
You may incur a non-compliance penalty up to a maximum of 20 penalty units if:
- you do not
- pay the required amount to us within 10 business days of receiving a valid release authority
- return the RAS to us within 10 business days and
- you release an amount that is not the lowest amount of
- the amount stated in the release authority
- the maximum available release amounts for the super interest held by the super fund.
Types of release authorities
There are several types of release authorities that fund members can request release of their funds for.
Excess concessional contributions release authority
A fund will receive an excess concessional contributions release authority when:
- a member has exceeded their concessional contributions cap and
- elects to release up to 85% of the excess concessional contributions from their fund.
The released amount must be paid directly to us and is to be treated as a non-assessable, non-exempt benefit payment to the member.
Amounts of excess concessional contributions that are not released will be treated as non-concessional contributions.
Excess non-concessional contributions release authority
When a member exceeds their non-concessional contributions cap they have 60 days from the issue date of their determination to elect how the excess amount is to be treated. They can:
- elect to release their excess non-concessional contributions and 85% of the associated earnings from their nominated super fund
- elect not to release and be assessed for excess non-concessional contributions tax
- advise us which super fund they want amounts released from.
A super fund will receive an excess non-concessional contributions release authority when one of its members has exceeded their non-concessional contributions cap and the member has:
- elected to release the excess non-concessional contributions and 85% of associated earnings from that fund
- not made such an election after 60 days, and the Commissioner processes an election on their behalf.
You don’t need to amend the contributions report you provided for this member via the Member Account Transaction Service. Releasing this benefit doesn’t change the contributions that led to the excess.
Excess non-concessional contributions tax release authority
When a member elects to have their excess non-concessional contributions assessed as excess non-concessional contributions tax:
- they advise us which funds they would like a release authority issued to, and
- will be issued a release authority by us to their nominated fund to pay their tax liability.
Division 293 tax – due and payable release authority
Fund members assessed as having a Division 293 tax due and payable debt associated with contributions made to accumulation super accounts:
- can elect to release an amount from their fund within 60 days of the issue date to pay the tax debt
- will be issued a release authority by us to their nominated funds
- have the super fund pay the monies directly to us.
Division 293 tax – deferred debt account release authority
When a member has been assessed as having a Division 293 tax debt associated with contributions made to a defined benefit account, the tax debt:
- is deferred until the member takes their end benefit from their defined benefit account
- the member can elect to release an amount from their fund within 60 days of the issue date to pay the tax debt.
In this case, we will issue a release authority to their nominated funds. A defined benefit fund may comply with this version of the release authority and must pay the monies directly to us.
Division 293 tax – debt account discharge liability
This release authority is an interaction directly between the member and fund therefore it is not delivered in SuperStream.
We issue members with a notice of debt account discharge liability, with the determined final amount owing on a deferred Division 293 debt account.
The member can only present this release authority to the super fund that holds the defined benefit account to which the deferred debt is attributed. The super fund can only release the monies to us from the account that holds the defined benefit interest stated on the RA.
How to action this release authority
To action a Division 293 tax debt account discharge liability release authority:
- check that the authority is still valid – it must be given to you within 120 days of the date printed on it
- work out what amount you must release – you must pay the lesser of
- the amount of the Division 293 tax
- the amount nominated by the member
- the total value of the member's super interests in your fund (other than a defined benefit interest)
- complete the release authority statement and send both the statement and payment to us within 30 days of receiving the valid release authority.
First home super saver (FHSS) scheme release authority
A super fund will receive a FHSS release authority when one of its members successfully requests the ATO to issue a release authority under the scheme.
The amount released by the fund must be paid to us.
Tax treatment of release authorities
The payment of a release authority is a super benefit which is treated as a non-assessable, non-exempt benefit payment to the member.
In this instance, a super fund is not required to:
- calculate either the tax-free component or the taxable component of the super benefit when the amount is released
- reduce either the tax-free component or the taxable component of the super interest.
The cashing order for benefits paid to satisfy a release authority is:
- unrestricted non-preserved benefits
- restricted non-preserved benefits
- preserved benefits.
Determinations and notices of assessment
Where a member has been issued with an excess contribution determination (ECC or ENCC) or Division 293 notices of assessment (NOA) due to a fund or client reporting error:
- the Trustee must correct their incorrect reporting within 30 days of becoming aware of the error
- if the corrected reporting impacts the member’s excess contribution or Division 293 position, they will be issued with an amended determination or notice of amended assessment (NOAA)
- amended determinations and NOAA’s are generally issued within 6 weeks of updated reporting being received by us.
Due to privacy restrictions, we:
- can't disclose the details of a member’s excess contribution determination or Division 293 NOA, including whether an original or amendment has issued
- can only confirm whether amended reporting has been received or processed.
Don't contact us to:
- confirm whether an amendment has been or will be issued to a member
- ask us to speed up the issuing of an amended determination or NOA.
A member can confirm the details of their excess contribution determination or Division 293 NOA, by using Online Services or contacting us.
Release authorities and Successor fund transfers
Trustees need to provide a valid response to all release authorities that they receive.
The issuing of release authorities can't be suppressed during the limited-service period prior to successor fund transfers (SFT).
Failure to action a RA prior to an SFT occurring will cause the RA to remain outstanding. This will prevent us from issuing a new RA to the successor fund if required and may cause significant financial disadvantages to your members.
We understand that issues can arise that may complicate or prevent the actioning of a RA prior to an SFT. In that case, the transferring fund should lodge an enquiry via SES for advice on the management of RAs during an SFT.
Transferring funds who do not action a release authority and do not contact us via SES to discuss resolution options won't have met their obligations under relevant RA legislation.
For more information, see Successor and intra fund transfer reporting.
Should this information not solve your query we also provide assistance to funds in dealing with release authorities through the Super enquiry service for APRA funds.